Who was William Edwards Deming?

Put simply, he was a man with prodigious knowledge yet was able to express his ideas to those he spoke to in such a way as to bring about profound change.

Deming was an American engineer, statistician, professor, author, lecturer, and management consultant. He knew a lot about numbers but he wasn’t an accountant. In fact, he specialised in something which is called mathematical physics (if you want to understand what that is, click here).

Deming was a very, very clever chap. He is credited with the rise of Japan as a world-leading manufacturing nation, and with the idea of Total Quality Management (TQM).

One thing always leads to another
Deming went to Japan just after WWII to help set up a census of the Japanese population. While he was there, he taught ‘statistical process control’ to Japanese engineers – a set of techniques which allowed them to manufacture high-quality goods without expensive machinery. In 1960 he was awarded a medal by the Japanese Emperor for his services to that country’s industry.

The ideas Deming taught were:
1. The problems facing manufacturers can be solved through cooperation, despite differences.
2. Marketing is not sales. It is the science of knowing what repeat customers think of a product, as well as whether, and why, they will buy it again.
3. Initial stages of design must include market research, applying statistical techniques for planning and inspecting samples.
4. The manufacturing process must be perfected.

Deming said one disease was: Running a company on visible figures alone because many important factors are “unknown and unknowable.”

Perhaps there’s a lesson here for all professionals: in the words of Aldous Huxley – “Experience is not what happens to you; it’s what you do with what happens to you.”

Put it another way if you like, as: “It’s not what you know that matters, it’s what you do with what you know that’s important.”

What are you going to do with what you know, or what you learn from this email?

The very best publication on the Budget

Chancellor George Osborne has chosen 18 March date for his 2015 Budget. This will be the last Budget of the Parliament and is less than two months before the date of the general election.

His update on the economy, including any tax announcements, will come just weeks before Parliament breaks up ahead of campaigning for the 7 May 2015 poll.

Place your order now…

The Bizezia 2015 Budget Summary is not free but it’s offered at an amazing price. It will be published on 18 March 2015, just a few hours after the Chancellor presents his proposals to Parliament. You can now start placing your order for it here.

The earlier you order, the cheaper it is. You’ve already missed the chance to buy it for only £20 + VAT. The lucky subscribers got it for that price by ordering before 9 January. Remaining options are:

Order by 5pm on

Price

06/02/2015

£80 + VAT

06/03/2015

£140 + VAT

13/03/2015

£155 + VAT

The ICPA said glowingly: “This is simply the very best publication on the Budget available anywhere”.

By 2020, your car will look like a computer

From Australia, in Business Spectator, in an article by Richard Brooks: To take a look at the cars on your street, it might not be apparent that the automotive industry is going through one of its most dramatic periods of change. Yet, rising purchasing power in emerging markets, tightening emission regulations and advances in electronics are driving a major shift in how vehicles are powered, constructed and driven.

Nothing will supersede the internal combustion engine but vehicles will increasingly resemble computers integrated with home applications, their surrounding infrastructure and each other.

The line between car-maker and tech company will become increasingly blurred. By 2020, what a car looks like will depend very much on where you live.

Emerging markets and new brands
The biggest story in the next five years however is not an issue of technology but economics: hundreds of millions of people in emerging markets will buy cars, often for the first time.

In 2009 China overtook the US as the world’s largest car market, and by 2016 India and Brazil will displace Japan in fourth and fifth place respectively. This is an enormous opportunity for manufacturers in emerging markets to acquire economies of scale and launch themselves on the world stage.

Within a few years we are likely to see these new brands spread into developed economies. The signs are already there. Companies such as the Indian manufacturer Tata, which bought Jaguar-Land Rover, or China’s Geely, which now owns Volvo, are well placed to use these high-status brands and dealership networks to move into mature markets.

This won’t just mean different brands on the same old cars either. Car makers in emerging markets have to deal with price-sensitive first-time consumers, urban congestion, poor air quality and (in some cases) concerns over fuels costs. This creates a fertile space for innovation in smaller vehicles, where China is already dominant, and alternative fuels where emerging economies stand to gain a technological lead. Recent launches of models such as the long-range, low-cost electric Denza model in China and the super-low cost e2o in India highlight this trend.Read more: www.businessspectator.com.au/article/2015/1/14/technology/2020-your-car-will-look-computer

Instagram Social Marketing Strategy Kit

From Simply Measured: Make your brand a powerhouse on Instagram and take your strategy to the next level with this four-part kit. This collection of resources is designed to help you master the channel and develop an Instagram strategy that works for your brand.

What Makes People Top Performers?

From Gulf Business: Highly-rated Manfred Kets de Vries, professor of Leadership Development & Organisational Change, INSEAD, writes that top performers can be made.

High fliers are often a study in paradox. But what makes them so special?

Oganisational high flyers display many contradictory behaviour patterns, and it’s this paradoxical nature, which makes them so successful. Spotting nascent stars can be a challenge, not least because we can’t always be sure what we’re looking for. Some may first impress us as “golden larvae”, but never complete metamorphosis, while others grow into true butterflies.Read this interesting article at: gulfbusiness.com/2015/01/makes-people-top-performers/

Facebook at Work app aims for role in the office

Leo Kelion wrote on BBC News: Facebook is launching a new app that aims to expand the US firm’s presence within companies and other places of work.

The software is designed to provide a way for users to communicate as an alternative to email and other intranet systems.

The firm says information posted within the service is kept “secure, confidential and completely separate” from personal Facebook profiles.

Technical Stuff

Auditor regulation: effects of the EU and wider reforms

On 12 January, a discussion document on the implications of the EU and wider reforms of statutory auditor regulation was published on Gov.uk.

Executive Summary
Effective financial reporting underpins the development of the best businesses – those that others are willing to invest in and to do business with. It informs decisions that are made, for example, by shareholders, directors, investors and suppliers. Audit is an essential safeguard to provide independent assurance that the financial reporting of businesses properly reflects their circumstances. This discussion document asks for views on a range of reforms to enhance confidence and strengthen the audit regime. It looks at the structure for regulation, oversight and standards taking into account new European requirements, recent Competition and Markets Authority measures and recommendations, and wider work underway to refine technical and ethical standards.

It is therefore about how the UK can put in place the best possible regime, one that will most effectively respond to the modern fast moving, highly developed business economy. At the same time, the Government does not want to make unwarranted changes. The Government will consider the issues that arise in responses, ahead of a formal consultation, next year, on detailed proposals to change the regulatory regime.

Alongside this document, the Financial Reporting Council (FRC) is consulting on some of these issues, particularly related to ethical standards for auditors. This shows how a non-legislative approach could be taken to improve standards in line with the new European provisions.

Views of all interested groups are essential to inform the approach to the implementation of the: new European Directive on Audit; and to make legal provision for the application of the new EU Regulation that is now applied directly under EU law.

The Regulation will apply from 16 June 2016, by which time the new Directive must also have been transposed into national law.

Both the Directive and the Regulation provide Member State options. This discussion document gives you the opportunity to contribute to the Government’s thinking about how to implement the Directive; how to provide for the application of the Regulation; and how the wider framework for audit regulation could be improved in the light of these changes, those identified by the Competition and Markets Authority, and others from the FRC.

Guidance for Charities that need to submit accounts

The Charity Commission has launched a new digital tool to allow a third party, such as a charity’s accountant, to submit its accounts on the charity’s behalf. Previously only the charity itself was able to submit its accounts. The new service has the option for an “accountant or other nominated agent” to submit its accounts.

All charitable incorporated organisations (CIOs) regardless of income, and all other charities with income over £25,000 must submit their accounts and a trustees’ annual report to the commission.

Charity trustees are responsible for ensuring that the accounts are prepared and submitted. You can:

The Government has published a draft statutory instrument to prohibit a company from using a ‘cancellation’ scheme of arrangement to facilitate its takeover or merger. The government plans to amend the Companies Act 2006 to restrict the use of share capital reductions in company takeovers. This change will prohibit a company from using a ‘cancellation’ scheme of arrangement to facilitate its takeover or merger.

The draft regulations will not prohibit intra-group restructures, de-mergers, or debt restructuring. It will also not affect takeovers already in progress before these regulations take effect.

An information and impact note is provided which sets out the analysis behind the proposed legislative changes.

Who is likely to be affected?
Likely to be affected are companies that are parties to a future takeover to be implemented by means of a ‘cancellation’ scheme of arrangement, advisers to such companies, and their shareholders and creditors.

General description of the measure
The measure will protect the stamp taxes base by preventing the use of share cancellations by target companies in takeovers conducted using schemes of arrangement. Companies effecting a takeover or merger would in future be required to use a ‘transfer’ scheme of arrangement or a contractual offer, on which stamp tax on shares1 is payable.

Cyber security boost for UK firms

New measures to help UK businesses face the cyber security challenge and help the UK’s cyber security companies tap into the US market were announced on16 January 2015, as the Prime Minister visited the United States with UK cyber security firms. He was in the US for talks with President Obama and cyber security is high on the agenda as the government steps up its efforts to combat cyber threats against the industry. In a bid to win more British business for the growing sector, a group of 12 UK cyber security firms are also travelling to Washington to meet a host of US businesses.

New government support to keep UK businesses stay safe in cyberspace includes:

a new cyber security envoy has been appointed to help British small businesses and first-time exporters promote their business interests across the US. Andy Williams will be based in the British Embassy in Washington and help boost UK-US cyber security deals

new research published by the Department for Business, Innovation and Skills (BIS) which shows top UK companies are improving their responses to cyber threats. The results of the annual ‘Cyber Governance Health Check’ for FTSE350 companies shows increased awareness and action, along with areas for improvement

Five trends that will shape the workplace of the future

From Australia, in Business Spectator, Steve Coad wrote: The modern working environment is unrecognisable from offices of the past. Fax machines, individual offices and nine-to-five working hours are now confined to the annals of history. And, although it’s hard to imagine, it won’t be long before cubicle farms, individual desks and even the concept of a traditional office will be superseded.

To take a closer look at what work will look like in coming decades, the author and others collaborated with insight consultancy The Future Laboratory to produce a white paper that explores what the business environment of the future is likely to be.

Martin Pollins is a Chartered Accountant with wide experience in corporate finance and business management. He holds a number of directorships and has served on the boards of several companies, including those listed on the London Stock Exchange, AIM and OFEX.

He was a Council member of the Institute of Chartered Accountants in England and Wales from 1988 to 1996.

Martin Pollins ran his own firm based in Sussex and was the first Accountancy firm in the UK to advertise on television and Martin went on to create and launch the CharterGroup Partnership (the UK's first Accountancy network) and then LawGroup UK (one of the largest networks of lawyers in the country).

Martin started work on the Bizezia concept in 1996, developing the broad range of information resources and products over the past 18 years.